Thursday, January 6, 2011
When Should You Drop Collision Coverage?
Actually the better question is this: Am I paying more for comprehensive and collision coverage each year than my car is worth? When you answer THAT question then it should become clear to you if you should drop collision or comprehensive (or both) from your personal auto insurance policy. Most people make this change generally when the car is ten years old or older. There is no hard-fast rule about this, other than you need to make sure you own the vehicle free and clear with no outstanding loan balance. This decision also involves personal financial comfort level...ask yourself: if I get in a wreck, and it's my fault can I stomach the fact that I won't get any money to repair my car from the insurance company? But the first and foremost factor should be insurance premiums to car value ratio....if the premiums are amounting more than the value each year, than you are smarter to drop the collision.
Sunday, January 2, 2011
A New Year, Update Your Life Insurance...
Since new years seem to produce new resolve, save a little of that resolve for your Life Insurance update. WHY and WHEN should you update your Life Insurance? Whenever you have had recent LIFE CHANGES. These life changes can take the form of a change in marital status, an increase in income, a new home purchase, a new job, a new baby or a new business. This is certainly not an exaustive list but these examples represent life changes which result in more for you to financially protect. If you have had changes like these in the past several years, then you may be due for a Life Insurance update. Remember what we said before...if your survivors are protected soley by the life insurance you have at work, then they are woefully unprotected. Don't put it off...call your agent this week.
Friday, November 5, 2010
When Trees Fall Down And Golf Balls Fly....
Almost everyone knows someone who had a tree come down on their property in a storm...but what if a tree from MY yard falls on a neighbor's property, or if my neighbor's tree falls on my property....who's insurance pays up? Great questions, and here is the answer: If a storm causes your neighbor's tree to fall on your house, then your insurance pays for the damage. Wait, that doesn't sound fair! Sound fair or not, your neighbor's home insurance, under the dwelling portion of the policy covers only one house in this situation....his. And visa-versa for you. There are some policys that may vary however regarding who pays what when cutting up the tree and removing it.
As for the tree...what caused it to fall? We said that it was a big storm, right? "Cause" is a big part of who pays what. Now if your neighbor is practicing his putting skills (or the lack thereof) in his back yard, and then clubs a golf ball through your kitchen window....who's insurance pays there? In that case HIS insurance pays the bill. Why? If your neighbor CAUSED the accident, then your property damage is covered under the Liability and property damage portion of his home policy. Hey...a little bit of justice after all!
As for the tree...what caused it to fall? We said that it was a big storm, right? "Cause" is a big part of who pays what. Now if your neighbor is practicing his putting skills (or the lack thereof) in his back yard, and then clubs a golf ball through your kitchen window....who's insurance pays there? In that case HIS insurance pays the bill. Why? If your neighbor CAUSED the accident, then your property damage is covered under the Liability and property damage portion of his home policy. Hey...a little bit of justice after all!
Saturday, October 30, 2010
Your Homeowners Insurance: Does It Cover Flooding?
No... it does not. Flood insurance is easily confused with a common homeowners policy rider called water back up coverage. Here is the difference: Flood insurance covers against the peril of water entering your house through the walls or through the floor. Water back up on the other hand is water backing up from a sewer or drain, or the result of a sump pump failure. Water is water right? It does the same thing to your basement or first floor right? Makes a huge mess and leaves undesirable results either way right? Thats' right but it is a distinction your insurance company makes when paying or NOT paying for a claim. Maybe a call to your agent is in order for a separate flood policy.
Saturday, September 25, 2010
Take Your Agent Up On The Offer For An Insurance Review
What exactly is an insurance review anyway? Sounds like a phony, nebulous excuse by my agent to hit me for more insurance, right? Well, an insurance review may involve an offer from your agent to purchase broader coverage or an additional policy, but more importantly, an insurance review will remind you of where you stand regarding your current coverage. Plus, during an insurance review, you both might just discover an additional discount or two that you may now qualify for! Hey yeah, I'll take that discount!
As an agent, I can't begin to tell you how many times a client calls me after, for example, a heavy rain. It rained so hard that the client names his basement after a once popular movie: "A River Runs Through It". Then the question comes: "Insurance Man, do I have coverage for all this water in my basement?"
"Well, Mr.Client", I begin, "no you don't....you see when I called you two months ago to offer you an insurance review, you said 'I have all the insurance I need, and I'm just fine!', then you hung up. Now if you had just taken five minutes and allowed me to go though the original coverage you chose, we could have exposed this precarious possible danger you were risking by not carrying water back up coverage."
No sane human being likes buying more insurance coverage...but those same sane human beings love to discover that they have the proper coverage when something bad happens. So, the decision to purchase or not purchase an additional coverage, may just determine what side of the fence you end up on if something serious happens.
Insurance reviews are a good thing. If you have a good insurance agent, he or she will write or call at least once or twice a year and offer you one. When they do, take them up on the offer.
As an agent, I can't begin to tell you how many times a client calls me after, for example, a heavy rain. It rained so hard that the client names his basement after a once popular movie: "A River Runs Through It". Then the question comes: "Insurance Man, do I have coverage for all this water in my basement?"
"Well, Mr.Client", I begin, "no you don't....you see when I called you two months ago to offer you an insurance review, you said 'I have all the insurance I need, and I'm just fine!', then you hung up. Now if you had just taken five minutes and allowed me to go though the original coverage you chose, we could have exposed this precarious possible danger you were risking by not carrying water back up coverage."
No sane human being likes buying more insurance coverage...but those same sane human beings love to discover that they have the proper coverage when something bad happens. So, the decision to purchase or not purchase an additional coverage, may just determine what side of the fence you end up on if something serious happens.
Insurance reviews are a good thing. If you have a good insurance agent, he or she will write or call at least once or twice a year and offer you one. When they do, take them up on the offer.
Sunday, September 19, 2010
I Don't Want Any Life Insurance, What I Want Is.....
I don't need any more life insurance....but what I need is something that will guarentee that if I die that my family won't be under so much financial pressure! If I die my income won't be flowing into the house anymore, so it would really help if you could tell me how I could relieve several of the big money pressure points for my spouse, like the monthly mortgage, or the kids education fund, or the car payments, or the credit card debt!
Did you know that is exactly what life insurance can do for you? I know what you're thinking....life insurance is supposed to provide enough money to bury me so my family isn't stuck with a funeral bill right? Sure life insurance takes care of this, but it does so much more than just that. When a household wage earner suddenly passes from the scene, life goes on for the rest of the family, and so do the bills!
Another thing you may be thinking is this: "I have life insurance at work, so I am all taken care of". That is one of the biggest mistakes people make is assuming they have enough when they have life insurance at work.
Financial experts generally agree a head of family wage earner needs 10 to 15 times his or her salary in life insurance, when most jobs provide only 2 to 5 times your salary on average. Another leap in the dark is this: if you are putting all your eggs in your group life insurance basket plan, you are assuming you will work at your current job until the day you die. Other assumptions you are making are....
1)You will automatically get another job right away (Even though the country is currently approaching 10% uemployment)
2)Any other job you go to will automatically have the same or better group benefits that you have now (even though no one knows where the chips will fall when it comes to major changes in what employers will continue to offer in healthcare given the changes in store next year).
3)You are also assuming you will never get seriously ill, because if you do, you may have to leave your job and depend on a personal life insurance policy, which you never purchased because you assumed you had enough life insurance at work, which you may not be able to get now because you are seriously ill.
Are you beginning to see the downside of all of these assumptions? Leaps in the dark are precarious....and they are especially dangerous when it comes to leaps in the dark regarding the financial future of your family if something happens to you.
Every family needs a personal, permanant life insurance plan, regardless of whatever group benefits you have from work.
Did you know that is exactly what life insurance can do for you? I know what you're thinking....life insurance is supposed to provide enough money to bury me so my family isn't stuck with a funeral bill right? Sure life insurance takes care of this, but it does so much more than just that. When a household wage earner suddenly passes from the scene, life goes on for the rest of the family, and so do the bills!
Another thing you may be thinking is this: "I have life insurance at work, so I am all taken care of". That is one of the biggest mistakes people make is assuming they have enough when they have life insurance at work.
Financial experts generally agree a head of family wage earner needs 10 to 15 times his or her salary in life insurance, when most jobs provide only 2 to 5 times your salary on average. Another leap in the dark is this: if you are putting all your eggs in your group life insurance basket plan, you are assuming you will work at your current job until the day you die. Other assumptions you are making are....
1)You will automatically get another job right away (Even though the country is currently approaching 10% uemployment)
2)Any other job you go to will automatically have the same or better group benefits that you have now (even though no one knows where the chips will fall when it comes to major changes in what employers will continue to offer in healthcare given the changes in store next year).
3)You are also assuming you will never get seriously ill, because if you do, you may have to leave your job and depend on a personal life insurance policy, which you never purchased because you assumed you had enough life insurance at work, which you may not be able to get now because you are seriously ill.
Are you beginning to see the downside of all of these assumptions? Leaps in the dark are precarious....and they are especially dangerous when it comes to leaps in the dark regarding the financial future of your family if something happens to you.
Every family needs a personal, permanant life insurance plan, regardless of whatever group benefits you have from work.
Sunday, September 12, 2010
How High Should My Liability Limits Be?
Both your auto and homeowners insurance policy have a portion of coverage called "liability" protection....that's the part that protects you from being taken to the cleaners if you or one of your household members is responsible for injuring someone else or damaging their ride.
If you do injure someone else in a serious accident, who knows how high the victim's medical costs will be? With the cost of health care it could go into the gazillions, right? So should you carry a huge amount of liability for just such an occurrence?
Well, maybe not. The idea here of liability protection at it's very essence is for your financial protection in the event that you or one of your family members injurs another party. In other words, what you own is what you protect. So you should set your liability to the limit of what you own...your assets. For most people, their biggest asset is their house, then you can add other stuff like your cars, boats, vacation homes, your classic Johnny West cowboy action figure collection, and whatever else. This is the stuff injured people can potentially take away from you if you happen not to have enough liability to cover their injuries (No, Not My Johnny West action figure collection!!). On the other side of that coin, they cannot take from you what you do not have. So then the limit of your liability should be based on what you do have.
Unless you own absolutely nothing, you should never, never, never choose minimum state limits of liability. Take some time and add it all up, then check your policy limits. If they are not set where you think they should be set, call your agent and request your limits be raised. The difference in your premium will be minimal compared to other policy changes, like adding another car or driver to the policy. If you have young drivers in the house just starting out, your insurance company will match their liability with yours, so you need not worry about what your financial exposure may be for something your teen driver may do to someone else.
If you do injure someone else in a serious accident, who knows how high the victim's medical costs will be? With the cost of health care it could go into the gazillions, right? So should you carry a huge amount of liability for just such an occurrence?
Well, maybe not. The idea here of liability protection at it's very essence is for your financial protection in the event that you or one of your family members injurs another party. In other words, what you own is what you protect. So you should set your liability to the limit of what you own...your assets. For most people, their biggest asset is their house, then you can add other stuff like your cars, boats, vacation homes, your classic Johnny West cowboy action figure collection, and whatever else. This is the stuff injured people can potentially take away from you if you happen not to have enough liability to cover their injuries (No, Not My Johnny West action figure collection!!). On the other side of that coin, they cannot take from you what you do not have. So then the limit of your liability should be based on what you do have.
Unless you own absolutely nothing, you should never, never, never choose minimum state limits of liability. Take some time and add it all up, then check your policy limits. If they are not set where you think they should be set, call your agent and request your limits be raised. The difference in your premium will be minimal compared to other policy changes, like adding another car or driver to the policy. If you have young drivers in the house just starting out, your insurance company will match their liability with yours, so you need not worry about what your financial exposure may be for something your teen driver may do to someone else.
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